Investments in marketable securities consist of debt securities and equity investments. We classify all of our debt securities as available-for-sale (“AFS”). Except when fair value option is elected, AFS debt securities are recorded at fair value with unrealized gains or losses included in accumulated other comprehensive income (“AOCI”), net of applicable taxes. All equity investments are recorded at fair value with changes in fair value included in Investment and other income, net in our Consolidated Statements of Income.

In fiscal 2022, we have elected the fair value option for certain debt securities held within one of our affiliate investment portfolios for operational ease given the size and composition of this portfolio. All debt securities within this specific portfolio are recorded at fair value with changes in fair value included in Investment and other income, net in our Consolidated Statements of Income. We estimate the fair value of these securities using observed transaction prices, independent third-party pricing valuation vendors, and internal valuation models. AFS debt securities for which fair value option is elected are not subject to credit loss impairment. As of December 31, 2021, we held AFS debt securities for which fair value option was elected of $703 million. The difference between the aggregate fair value and the aggregate unpaid principal balance of long-term AFS debt securities for which the fair value option was elected was not significant.

	December 31, 2021
	Amortized		Unrealized		Unrealized			Fair
	cost		gains		losses			value
Available-for-sale debt securities:
U.S. government and agency obligations	$	491	$	5	$	(6	)	$	490
Foreign government and agency obligations		32		-		(1	)		31
Municipal debt securities		9		2		-			11
Commercial paper		25		-		-			25
Corporate debt securities		589		15		(3	)		601
Mortgage-backed securities:
U.S. government agency		21		1		-			22
Non-agency residential		11		-		-			11
Non-agency commercial		75		2		(1	)		76
Asset-backed securities		86		3		(1	)		88
Total available-for-sale debt securities	$	1,339	$	28	$	(12	)	$	1,355
Equity investments									3,766
Total investments in marketable securities								$	5,121

	March 31, 2021
	Amortized		Unrealized		Unrealized			Fair
	cost		gains		losses			value
Available-for-sale debt securities:
U.S. government and agency obligations	$	217	$	4	$	(10	)	$	211
Municipal debt securities		8		2		-			10
Commercial paper		196		-		-			196
Corporate debt securities		177		12		(2	)		187
Mortgage-backed securities:
U.S. government agency		31		1		-			32
Non-agency residential		1		-		-			1
Non-agency commercial		47		2		(2	)		47
Asset-backed securities		49		3		-			52
Total available-for-sale debt securities	$	726	$	24	$	(14	)	$	736
Equity investments									4,084
Total investments in marketable securities								$	4,820

A portion of our equity investments are investments in funds that are privately placed and managed by an open-end investment management company (the “Trust”). If we elect to redeem shares, the Trust will normally redeem all shares for cash, but may, in unusual circumstances, redeem amounts exceeding the lesser of $250 thousand or 1 percent of the Trust’s asset value by payment in kind of securities held by the respective fund during any 90-day period.

We also invest in actively traded open-end mutual funds. Redemptions are subject to normal terms and conditions as described in each fund’s prospectus.

For the nine months ended December 31, 2021, non-cash investing activities related to in-kind redemptions and subsequent purchases amounted to $1.1 billion. There were no non-cash investing activities related to in-kind redemptions for the three months ended December 31, 2021.

Available-for-sale debt securities in a continuous loss position for less than twelve months and greater than twelve months were not significant as of December 31, 2021 and March 31, 2021.

An allowance for credit losses is established when it is determined that a credit loss has occurred. As of December 31, 2021, management determined that credit losses did not exist for securities in an unrealized loss position. This analysis considered a variety of factors including, but not limited to, performance indicators of the issuer, default rates, industry analyst reports, credit ratings, and other relevant information, which indicated that contractual cash flows are expected to occur.

The following table represents gains and losses on our investments in marketable securities presented in our Consolidated Statements of Income:

	Three months ended					Nine months ended
	December 31,					December 31,
	2021			2020		2021			2020
Available-for-sale debt securities:
Unrealized (losses) gains on securities for which the fair value option was elected	$	(4	)	$	-	$	3		$	-
Realized (losses) gains	$	(1	)	$	2	$	(1	)	$	19

Equity investments:
Unrealized gains	$	26		$	49	$	84		$	188
Realized gains on sales	$	-		$	3	$	22		$	15

The amortized cost and fair value by contractual maturities of available-for-sale debt securities are summarized in the following table. Actual maturities may differ from contractual maturities because certain borrowers have the right to call or prepay certain obligations.

	December 31, 2021
	Amortized cost		Fair value
Available-for-sale debt securities:
Due within 1 year	$	127	$	127
Due after 1 year through 5 years		372		375
Due after 5 years through 10 years		357		359
Due after 10 years		290		297
Mortgage-backed and asset-backed securities ¹		193		197
Total	$	1,339	$	1,355